Challenger accountancy firm RSM last night elected a new chief executive after a marathon virtual general meeting while rival Grant Thornton slashed wages to help survive the coronavirus crisis.
RSM announced last night shortly before midnight that former corporate finance head Rob Donaldson had claimed the top job.
The Telegraph reported that Donaldson saw off the challenge of nine other partners – including interim chief operating office Jill Jones who was backed by the board – to win the vote.
The meeting started at 11am with Donaldson’s appointment confirmed late last night.
Sources close to the firm stressed that the length of the proceedings were partially a result of over 400 shareholders dialling into a virtual meeting and all ten candidates for the role making. individual pitches and fielding questions.
RSM cleared out its top management team at the end of last year after it made errors in its provisions for professional liability claims in 2018 and in earlier years.
Earlier this month a group of rebel shareholders tabled a motion to remove its board following the embarrassing accounting error.
RSM’s board resigned on 17 April with a new board expected to be appointed within 48 hours.
Donaldson said: “During this tremendously challenging period for all of us, our priority in the short term is to continue to carefully manage the wellbeing of our people, and to protect the business in the interests of our clients.
“For that reason, I will be announcing my new board, followed by the wider
national leadership team, over the course of the next 48 hours.”
Fellow challenger firm Grant Thornton – which RSM replaced as auditor to Sports Direct last year – has cut the pay and hours of 300 UK employees as it tries to weather an expected 20 per cent drop in profit, the Financial Times reported.
Grant Thornton decided not to use the government furlough scheme – but told staff they would not be in a worse off position than if they had been in that scheme.
Under the coronavirus job retention scheme the government pays 80 per cent of the salary of furloughed workers up to a monthly total of £2,500 a month.
A Grant Thornton spokesperson said: “Whilst many of our teams continue to operate at full capacity, we recognise that some limited areas of the firm are less busy, owing to current market demand for the services they specialise in. In order to preserve as many roles as possible without drawing on the support the government has made available through the furlough scheme, certain teams will now be working reduced hours in the short to medium term.”
The FT said the heaviest blow would fall on the firm’s transactional team which has been hit by a dramatic slowdown in M&A, as well as some administrative and marketing staff.